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Oklahoma Schools Required To Teach Students Personal Finance
Hugh Pickens DOT Com writes "Paula Burkes reports that under legislation passed in 2007, Oklahoma students, effective this May, now must demonstrate an understanding in banking, taxes, investing, loans, insurance, identity theft and eight other areas to graduate. The intent of personal financial literacy education is to inform students how individual choices directly influence occupational goals and future earnings potential. Basic economic concepts of scarcity, choice, opportunity cost, and cost/benefit analysis are interwoven throughout the standards and objectives. 'Oklahoma has some of the strongest standards in the country,' says Amy Lee, executive director of the Oklahoma Council on Economic Education, which lobbied for and helped develop the curriculum. 'Where other states require four or five standards regarding earnings, savings and investing, Oklahoma has 14 standards including three that are state-specific: bankruptcy, the financial impact of gambling and charitable giving.' The law is designed to allow different districts to implement the curriculum in different ways, by offering instruction in various grade levels, or by teaching all the curriculum in a single class or spreading it across several courses. 'The intent of this law was always to graduate students out of high school with a strong foundation in personal financial literacy to reduce the many social ills that come from mismanaging personal finance,' says Jim Murphree. 'I cannot think of anything that we teach that is more relevant.'"
Maybe students will fully understand the ramifications of going deep in to debt to with student loans.
I can get behind this type of teaching. As the summary states, there is nothing more relevant to someone graduating from high school with no real experience or specific working knowledge that is not self-taught.
It's actually unfortunate that they left it up to the districts as that means there will inevitably be multiple districts where it is planned, or taught, by someone who has no clue about it themselves.
This was required in Oregon when I was in high school. I was amazed to discover it wasn't mandatory everywhere.
Absolutely. Long overdue.
step in and cry foul that schools shouldn't be teaching kids to be wise with the finances as it will upset the delicate balance of free enterprise.
by TheSpoom (715771) Uncaring Linux user here. I have nothing to add to this but please continue. *munches popcorn*
Hopefully this will help reduce the divorce rate.
Divorcé's Guide to Marriage - Study Reveals Five Common Themes Underlie Most Divorces
Money was the No. 1 point of conflict in the majority of marriages, good or bad, that Dr. Orbuch studied. And 49% of divorced people from her study said they fought so much over money with their spouse—whether it was different spending styles, lies about spending, one person making more money and trying to control the other—that they anticipate money will be a problem in their next relationship, too.
Many marriages today are 'til debt do us part
much of left-wing thought is a kind of playing with fire by people who don't even know that fire is hot - George Orwell
Usually an attitude held by those who've not lived there. It's a bit different, but given their population mix, about what you'd expect.
Organization? You must be joking..
Oklahoma's teachers had better use shorter words in their curriculum than their lobbyists used for the press.
Though I also think high schoolers should be required to work a minimum wage job before graduation, for at least a few months. That way, instead of abstract concepts, they know "it feels like this to earn $100.00."
-- Sometimes you have to turn the lights off in order to see.
Because even if you have a decent-paying job, you can still make shit decisions and piss it all away very quickly. Look at the large percentage of NFL players who are bankrupt at the end of their careers as a simple illustration of this. This is also true with the vast majority of people who don't earn nearly that amount of money. LIVE WITHIN YOUR MEANS, whatever they may be.
I'm sure someone will stand up shortly and complain that this is somehow racist, sexist, or otherwise deleterious to the well-being of the pupils being schooled. Can't have kids learning about how money is made, handled, taxed, and invested. That would interfere with them being good little minions who simply do what they're told by their betters...i.e. those in government power.
In the end they will lay their freedom at our feet and say to us, Make us your slaves, but feed us. - Fyodor Dostoyevsky
Its about time. I don't recall this being mandatory when I was in school back in the 80's, though I took a basic accounting class as an elective, it was not required. Most of the folks I know who are my age (mid 40's) have at least a basic understanding of these concepts, though the high level of credit card debt shows we're not immune to idiocy.
But I recently had to bang my head against a desk and wonder WTF is wrong with the next generation when a 20 something I know and am "friends" with on Facebook posted about his first paycheck as a full time employee. His comment was along the lines of "The company I work for screwed me over. I worked 40 hours at $10/hr. I made $400 and I only brought home about $275. I should have made about $100 more, I mean taxes are only 6%" (6% is our state sales tax). This was followed by a few dozen posts by his contemporaries who were offering him condolences, telling him to find another employer who wouldn't screw with his money, etc. A few days later he complained about how his bank was screwing him out of money because he had $50 in his account and deposited a check for $250 then used his debit card to make a $100 purchase..... According to him, he should still have $200 and is pissed that his bank screwed him because he now has only $170...... no one ever explained to him that a debit card purchase clears the bank within hours, a day at most while the check he deposited might take up to 3 days to clear and he had overdrafted and been fined $30. Again, none of his contemporaries posted that he was an idiot, the overwhelming number of posts were about how banks screw them all the time saying that they did not have enough money in the bank when they just deposited a check...
Yet another posted about his experience buying a car..... it was $8000, it was a 3 year loan. I forget the exact interest rate but say it was 5%.... He at least understood that 5% meant $400, but had no clue why his payment was going to be higher than $235, no one had ever explained compounding interest to him. We started talking and I explained that when I bought my house I financed 200k @ 3% interest for 30 years. I asked him what he thought my payment was.... He pulled out his phone, openned up the calculator and figured I was only paying about $575/month and said that he should buy a house instead of renting, it would be cheaper...... When I explained the concept of compounding interest, and escrow for taxes and insurance, he was shocked. When I told him that that was actually a decent interest rate and you'd pay more if your FICO score was low, he stared at me blankly and asked "My what score".
These were both high school graduates, both with full time jobs. I know its only anecdotal, but A mutual friend who is my own age and I were talking later and he told me that he didn't bother to respond because he'd had this conversation only a few months earlier with someone else who still didn't get it even after having it explained to them.
I took a Macroeconomic and a Microeconomic course in College and having even a basic understanding of Supply&Demand and Opportunity cost has helped me immensely in life, to better understand the motivation of how anything works.
Following your argument (that teachers generally aren't able to teach, if I read correctly) to the obvious extreme, why don't we just do away with schools completely as they're obviously pointless. Really?
We used to have civics classes back when I was in school. We learned about the Federal, State, County and City governments, their structure, how you can interact with government, etc. Too many people are so clueless about how it all works they shouldn't even be allowed to vote (although most of them probably don't).
You know, I count myself firmly as a dyed-in-the-wool liberal, but one of the strong suits of conservatism as a philosophy is a belief both in the value of self-reliance and self-responsibility, especially in a financial realm. I have no surprise seeing this come from a red state, and I wish more states would embrace such a curriculum.
It's irresponsible that we don't teach kids how to manage money, and it's a good place to get in their heads that math is useful for something, even if they don't like it. We need a society that values saving and long-term rewards over short-term consumption.
We spend too much time thinking of the other side as "the enemy" because of "wrong" beliefs that don't match our own and not enough time looking seriously at their strengths and how we can embrace those as common values -- places where we need to step up our own game in a bipartisan fashion.
So, good for you, Okies. May this be an example for the rest of us.
If it's for-profit but free, you're not the customer -- you're the product (e.g., the Slashdot Beta's "audience").
forget about managing money.
just learn to SUMMARIZE, dammit.
we ain't got time for this shit, man!
--
"It is now safe to switch off your computer."
Well...
My wife went to public school in Massachusetts in the 1960s and 1970s and in her town they taught personal finance as part of the curriculum. I think a lot of that kind of forward thinking went out with ed reform, which focused on more traditional academic subjects. Massachusetts was early on the ed reform bandwagon, and consequently our students perennially top the nation in math, science and reading scores in the past decade. It sounds like the Mass DoE is looking for a way to shoehorn back in some of the content that got squeezed out.
Post may contain irony: discontinue use if experiencing mood swings, nausea or elevated blood pressure.
According to him, he should still have $200 and is pissed that his bank screwed him because he now has only $170...... no one ever explained to him that a debit card purchase clears the bank within hours, a day at most while the check he deposited might take up to 3 days to clear and he had overdrafted and been fined $30. Again, none of his contemporaries posted that he was an idiot, the overwhelming number of posts were about how banks screw them all the time saying that they did not have enough money in the bank when they just deposited a check...
To be fair, that's a legitimate complaint. There's no justifiable reason for that delay nor is there one for not giving a grace period until the end of it before finalizing the overdraft fee. The only reason that historical processing delay is still there is to screw customers out of a fee that wouldn't happen if they put as much emphasis on processing deposits as they did on withdrawals. There's no technical justification for such a difference between the two nor for the lack of forgiveness.
He may be ignorant for not expecting to be screwed in that way, but it is still him getting screwed for no better reason than that it's a revenue stream for the banks.
If it's for-profit but free, you're not the customer -- you're the product (e.g., the Slashdot Beta's "audience").
The Federal Government has no constitutional authority to set education standards. It's a state issue.
Rules to teach your kids:
1. NEVER own a credit card. They serve no purpose and the fact of the matter is, if you use one responsibly (only in emergencies) the credit card company will cancel your card for lack of use after a few months anyway. Trust me, I tried for years to keep one but even with an 800+ credit score they'd cancel it every time.
This is terrible advice. Using a credit card responsibly doesn't mean "only for emergencies," it means "only for expenditures you would have otherwise, and COULD HAVE OTHERWISE, paid for with cash." Pay your bill on time, you pay zero interest, and get cash back.
Heck, I'm single and I find it incredibly useful to pay *myself* for taking care of unappealing tasks. I keep a separate "luxury" account that all my gadgets, dates, beer, sweets, etc. get purchased from - basically all the "vice" stuff that doesn't directly contribute to my long-term well-being. I then pay into that account for all the stuff I "should" do more often - exercising, mopping the floors, etc. All the usual "earn your allowance" stuff, plus any behavioral modification I wish to inflict.
In practice I've got a daily/weekly/monthly checklist with compensation for every chore fine tuned to get me to actually do the stuff reliably. $0.25 for ten reps of exercise for example - nothing really, but I can easily earn a buck waiting on commercials, and 50-100 reps of mixed exercises scattered throughout the day can make a dramatic difference.
--- Most topics have many sides worth arguing, allow me to take one opposite you.
When my parents were in high school and college, "Home Ec" classes were actually about home economics (ranging from budgeting to investments to the consequences of bankruptcy and even to running a home business). By the time I was that age, those subjects were all but gone (at least in the area I went to school, namely western Washington state) and what vestiges of them were left seemed to be about... cooking, or something. Nobody really talked about them, except in a disparaging voice intended to deride girls who had no real place in the school so they took "home ec" because that was all they could manage. Yes, they really were that sexist about it, too.
I've often thought it was a pity that *real* home economics classes - the kind of things that every adult ought to know, but so few people apparently learn - really ought to be standard material. What are the various kinds of investment accounts, and what are their tradeoffs? How can you calculate how much stock options are likely to be worth at a company? What is a "short sell" and why should or shouldn't you do them? What does it mean to "refinance" a loan, and when can or should you do it? How do you compare salaries in areas with different costs of living? When is renting a home more cost-effective than buying one? What kinds of things impact your credit score in what ways? How expensive of a car can I afford? Is it better to get a short loan or a long one (or none at all) in various common scenarios? Why is it better to diversify investments?
These aren't business major questions. You don't need a degree in economics to understand them. They don't even require advanced mathematics, certainly nothing above a typical high school curriculum. At least some of this material is highly likely to be useful to literally every single competent (as in, doesn't need a full-time caregiver) adult, and in a capitalist society, the costs of *not* knowing it can be severe.
Despite that, we don't usually teach those subjects in school. I got a bit from my parents, a bit from some extraordinary teachers I had prior to high school, a tiny bit from an intro econ class in college (said class focused more on theoretical economics, not on the real-world stuff), and a bit more through independent research... and I'm still not confident that I can answer all the questions above (I intentionally included some that I've been meaning to read up on in the future). I've been out of college for four years now...
There's no place I could be, since I've found Serenity...
I know lots of people from right-wing families, who got lots of help with their businesses and so are now quite wealthy, quite often through no fault of their own.
I personally feel very strongly that I must succeed on my own merits, so actually for most of my career I've been self-employed. But I never got any real help from anyone other than, if I'm really lucky, the occasional helpful advice.
I learned the very, very hard way that accountants and attorneys are a compete waste of my valuable time. They are willing to give me real bad advice in return for an hour of their fees, but they only give good advice to those with deep pockets.
Consider say Ronald Reagan. He was very poor when he was a child, but quite wealthy as an adult. But then as adult, he did everything in his power, to enable the already rich, to get even richer, while at the same time knocking down the poor people. For example one of his very first acts as president was to deny food stamps to college students.
Please mail me URLs of software employers.
It's called an allowance and it's considered by many financial experts to be among the best ways to teach money management to children.
It's an excellent tool to teach savings, splitting income, spending, instant vs. delayed gratification, etc. in a really safe environment (because "bankruptcy" Is a harsh, but temporary lesson. Sadly, you learned the hard way what it was like to not grow up with those skills.
That's the point of an allowance. An allowance is a life-training tool to manage money. The kid learns that he COULD spend the hard earned savings on an ice cream, or he COULD leave it save up for that toy he really wants.
The point is to learn these lessons in a relatively safe environment (if they blow their wad on ice cream, they don't have to worry about food, shelter, etc). And to learn the value of splitting your "income" in various bundles - a dollar to long term savings (to get the toy you want), a dollar to spend, a dollar to save for times you need more than you have or emergencies, a dollar for charity, etc. And if one forgoes spending, that can make the long term savings for the thing you really want go so much faster.
And instant gratification versus delayed gratification is an important lesson. Ice cream now vs. now having to wait another month for the toy.
Finally, one thing children learn way too quickly is how to be a tightwad. Sure it helps to save money, but to pinch every penny may not be the best way (price does not equal value) - spending more might be a better option. Anyone's whose dealt with a parent who insists on keeping their 10 year old junker PC going instead of buying a new one knows this. Plus, instill in them the need to actually go out and socialize with friends - sometimes the goal of saving gets in the way of life and it can lead to health and mental issues - there's absolutely nothing wrong with having fun with friends and getting together, but absolutely wrong (especially for mental health) if you're avoiding friends just to save up for something. It's why you have a "spend/fun" jar.
I know that was one of my mistakes - putting every penny in a savings jar without putting anything in towards having fun now (you want to die alone as a rich, but miserable person?).
Many consider college to be a "base" education these days. So are you asserting that you and you alone get to determine what you think "base" is and who should get what money? And why are you equating "mandatory" with "base"?
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